Mahindra & Mahindra Ltd. (MM), India's largest maker of sport utility vehicles and tractors, reported fourth-quarter profit increased 44 percent on higher sales and a one-time gain.
Net income, excluding subsidiaries, rose to 8.74 billion rupees ($156 million) in the three months ended March 31 from 6.07 billion rupees, the Mumbai-based company said today. This beat the 6.17 billion-rupee median of 38 analysts’ estimates compiled by Bloomberg. It reported a one-time gain of 1.08 billion rupees, according to the statement.
Sales climbed 39 percent to 92.4 billion rupees. The maker of Xylo and Scorpio vehicles sold more of its vehicles, the bulk of which are diesel powered, after rising gasoline prices prompted car buyers to opt for subsidized diesel.
"The growth in the profits of the company, despite the relentless increase in material costs, is due to a good volume performance by both vehicles and tractors and tight control on expenses," Mahindra said in a statement today. "The company expects growth to pick up in the second half of 2012-13."
Shares of the automaker rose 0.6 percent to 659 rupees as of 2:35 p.m. in Mumbai trading. The benchmark Sensitive Index declined 0.2 percent.
The utility-vehicle maker, which introduced the XUV500 sport-utility vehicle last year to compete in the premium SUV market, said on May 28 that it had raised capacity to 4,000 units a month, and would begin taking orders from across the country from June 8. Priced between 1.15 million rupees and 1.4 million rupees, the XUV500 initially received 8,000 orders in 10 days.
A second round of bookings resulted in over 25,000 bookings, according to the statement.